Crowdfunding has become all the rage in the world of startups. There are rewards-based crowdfunding such as Indie Go Go and Kickstarter, and there is equity crowdfunding under the Jobs Act – which is still legally pending.
Determine the platform you will use.
- With Kickstarter, it’s all or nothing. You either raise your goal by the deadline and keep it all, or if you miss the mark even by a dollar you don’t get to retain any of it. With Indie Go Go and Rockethub, you have more options. Research them to figure out which is best for you.
Identify your IP beforehand.
- It’s vital that you figure out what intellectual property you want to make public and which you want to keep private. Research what defines patents, trademarks and copyrights and use them accordingly.
Build your social capital.
- It doesn’t matter if you have a cutting-edge product or idea, if you don’t have an established following who is looking forward to its release, you’re bound to fail. Take advantage of social media across multiple platforms to build some buzz and get the word out ahead of time.
- When creating your promotional campaign, whether it’s comprised of video or audio content, make sure you have legal permission to use these materials. You don’t want to put yourself in the position where you successfully raise your intended capital, only to get slapped with an infringement lawsuit after the fact. Sites such as Creative Commons allows you to use various content for such purposes legally.
Crowdfunding can be a very fun and efficient means of raising funds for your product, so long as you do your research and make sure you are using it properly.